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Philippines: US-EU sanctions making Iranian trade difficult

Philippine banana growers are having to consider halting the supply of their produce to Iran - one of their biggest markets - as Western sanctions are holding up payments on shipments, according to the head of an industry group.

Payment from Iran usually takes two weeks, but recently this has been extended to four weeks and Iran has even resorted to offering payment in oil instead of cash, said Stephen Antig, president of the Filipino Banana Growers' and Exporters' Association.

"Some of the local banana producers are now rethinking if they should continue trades with Iran," Antig said.

The sanctions from the US and the EU make it difficult for Iran to pay for food and other imports. Another option is for payment to be made in currencies other than the Iranian rial.

"We continue to ship to Iran and the volume has not really decreased significantly," he added. The exporters' group from the Philippines, the world's third biggest banana exporter, shipped 560,000 tons of the fruit to the Middle East last year, sending half of that volume to Iran.

Antig said the figure did not include exports by small banana growers, who do not belong to the group, which represents 32 companies. He said the industry group had discussed Iran's proposed oil-for-banana deal with Trade Secretary Gregory Domingo, who advised it to seek other markets despite Iran being one of the three biggest buyers of Philippine bananas.

"I think the government should really look into that," said Antig, regarding the oil-for-bananas deal. "We are open to all possibilities and all options for as long as we can continue exporting bananas to the Middle East and Iran."

An oil for fruit deal is unlikely as the US has been urging other nations to reduce imports of Iranian oil. The Philippines is required to reduce Iranian oil imports to ensure exemption from sanctions commencing on February 29th.

Source: www.abs-cbnnews.com

Publication date: 2/24/2012


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